Jurisprudentiol - Thursday's cases

By Vijay Kumar

Legal Corner Icon — the image was hosted by the publisher and was not captured.Central Excise

Lacquered Metalised Polyester film is cleared to job worker for conversion to Zari which is finally cleared from factory under exemption - appellant paying 8% price of exempted product/reversing credit contained in inputs - no cause for payment of duty on Lacquered metalized Polyester film when cleared for job work - facts in knowledge of department - Demand time barred - Appeal allowed: CESTAT

THE appellant are engaged in the manufacture of Lacquered Metalised Polyester Film as well as Imitation Zari. The appellants were clearing Lacquered Metalised Polyester film on payment of appropriate duty. The appellants were also clearing Lacquered Metalised Polyester film to the job worker under Rule 57F(4) challans for further processing in the manufacture of Imitation Zari. Imitation Zari was received by the appellant and after packing the same were cleared at nil rate of duty as Imitation Zari is exempted.

The case of the revenue is that clearance of Lacquered Metalised Polyester film to job worker should have been on payment of duty as the same are finished goods.

Customs

Set Top boxes imported and supplied to the consumers on right to use basis - Sales tax was paid by treating such right to use as sale - Refund of SAD cannot be denied on the ground that there was no sale: CESTAT

THE issue involved is whether the importer is entitled for refund of additional duty (SAD) paid at the time of import of the goods in terms of Notification No 102/07Cusdated 14.09.2007. The said Notification provides exemption from additional duty of customs levied under Section 3(5) of the Customs Tariff Act, 1975 when the imported goods are sold subsequently. In the instant case, the importer supplied the set top boxes to the consumers on right to use basis and there is no absolute sale of the goods.

Income Tax

Whether when there is neither concealment nor furnishing of inaccurate particulars, even then mere erroneous claim would attract penal provisions u/s 271(1)(c) - NO: ITAT

THE assessee is a Multi Specialty Hospital and Nursing Institute which had claimed depreciation @ 4O% on the block of assets of life saving equipment which included on addition of Rs.55 lakhs. The AO noted that as per the depreciation table relevant to the assessment year 2005-06 provided in the appendix of Income Tax Rules 1962, among the list of life savings medical equipment eligible for depreciation @ 40%, the name of CT Scan Machine is not mentioned. Hence, the AO held that CT Scanner machine purchased during the year is not eligible for depreciation @ 40% under the block of life saving medical equipment. The assessee did not offer any explanation in this regard and submitted that depreciation @ 40% was claimed under the bonafide belief that it is covered under 'lifesaving medical equipment' just like Magnetic Resonance Imagine System ("MRI") on which it has been claiming depreciation @ 40% since A.Y. 2003-04. The A.O., however, noted that the assessee reduced the amount of Rs.5 lakh on account of sale of old CT scan machine from the WDV of the block of assets under the head 'plant & machinery' eligible for depreciation @ 40% and not from the WDV of block of assets under the head 'life saving medical equipment' eligible for depreciation @ 40%.

See our columns Tomorrow for the judgements